In order to increase society's total welfarer, a production process that produces a negative externality should be

Consider the same ultimatum game as in the previous questions but consider yet new preferences reflecting envy. In particular, now assume players get 1 util per dollar earned. That is all for the player who earns at least as much as the other. The player who earns strictly less than the other loses 1 util for each dollar difference. Which of the following is an offer that arises in a

subgame-perfect equilibrium with these preferences? a. 1. b. 2. c. 4. d. 5.

Other things the same, which of the following could explain a rise in Sweden's net capital outflow?

a. interest rates on Swedish bonds rise b. the probability of default on Swedish bonds rises c. Sweden enacts a law reducing taxes on income earned by foreign-owned businesses operating in Sweden d. None of the above are correct.